Procedure for transfer of Input tax credit on the death of proprietor

Procedure for transfer of Input tax credit on the death of proprietor:

Procedure for transfer of Input tax credit on the death of proprietor. It is very crucial topic and is duly addressed by CBIC via circular no. 96/15/2019.  Many taxpayers were facing this issue as it was not clear how to take the ITC of the deceased proprietor in case of death. Let us discuss this issue on detail.

Apply for the new registration in the PAN of transferee:

GST is a PAN based system. You can do business in some other PAN. On death of a proprietor the PAN get changed. So the transferee need to take a fresh registration in his name to run the same business. This is also important to get the ITC transferred. Unless you have a GSTIN you wont be able to shift the ITC of deceased/transferor. While applying for the registration chose the following option (whatever is relevant) as reason of registration.

Procedure for transfer of Input tax credit on the death of proprietor

File ITC 02 from the dashboard of deceased proprietor: 

First of all file the form ITC02 from the dash board of the deceased proprietor. you can transfer the existing ITC to the new account. While filing the form ITC 02 you will get an option to fill the GSTIN where you want to transfer the ITC. You can transfer it to the transferee from that option.

How to shift ITC on transfer

You can shift ITC using the table as shown above in image.